UK Oil & Gas PLC (AIM:UKOG) Horse Hill Water Reinjection Update

UK Oil & Gas PLC (London AIM: UKOG) is pleased to announce that, as a necessary precursor to its planned Horse Hill-2z (“HH-2z”) Portland formation water reinjection project, the Company has now installed three, shallow, groundwater monitoring boreholes at its 85.635% owned producing oil field.

The water injection programme seeks to improve the field’s net earnings by approximately £250,000 per annum by eliminating the substantive costs of tankering and disposing produced saline formation water at distant third-party sites. The removal of tankering will also reduce the field’s overall carbon footprint. The injection itself will help maintain reservoir pressure which can help improve ultimate oil recovery.

Initial sampling of the boreholes, which terminate within the impermeable Weald Clay formation, found no obvious groundwater immediately beneath the site. A three month baseline monitoring period is now underway prior to the start of reinjection operations.

Surrey County Council and the Environment Agency approved the installation of these boreholes, the frequent sampling of which is designed to ensure that no produced saline Portland formation water penetrates into the Weald Clay sediments underlying the site.

Stephen Sanderson UKOG’s Chief Executive commented:

” The new boreholes are a key step towards delivering HH-2z produced water reinjection, ultimately designed to help reduce operating costs by some £250,000 per year and improve the field’s oil recovery. The work is fully in keeping with current environmental standards and practices and demonstrates UKOG’s responsible attitude towards ensuring the area beneath the site remains as well protected as possible.”

Qualified Person’s Statement

Matt Cartwright, UKOG’s Commercial Director, who has 39 years of relevant experience in the global oil industry, has approved the information contained in this announcement. Mr Cartwright is a Chartered Engineer and member of the Society of Petroleum Engineers.

For further information, please contact:

UK Oil & Gas PLC

Stephen Sanderson / Allen D Howard

Tel: 01483 941493

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